Agri sector primed for investment

Large scale investments could act as a springboard for Vietnam’s agriculture industry

Senior agricultural expert Pham Hoang Ngan told VIR that at least 30 large domestic enterprises were planning to implement major agricultural projects in Vietnam in the near future.

“They are working with authorised agencies for support. A billion dollar wave of private agricultural investments will hit Vietnam soon,” she said.

These 30 enterprises include big brand names like Vinaseed, TH Group, Trung Nguyen, Vingroup, Viettel, and Minh Phu. For example, a TH Group source told VIR that in addition to its $1.2 billion concentrated dairy cow and fresh milk production project in the central province of Nghe An, the group planned to invest over VND4 trillion ($187.8 million) into a 3,000 hectares project to raise 20,000 dairy cows in the central province of Thanh Hoa. The group is also planning to invest VND7.348 trillion ($345 million) into building a 3,171ha project to raise 20,000 dairy cows to produce fresh milk in the Central Highlands’ province of Lam Dong. In addition, it would invest VND13 trillion ($610.32 million) into building a 12,000ha project to produce fresh milk from 72,000 dairy cows in the Central Highlands’ province of Dak Lak.

The group is also focusing on forestry projects. It is investing $500 million into its May Forestry Joint Stock Company, with two projects in Nghe An, including a $150 million wood bar plant, with the annual capacity of 8,800 cubic metres, and a $350 million MDF wood plank plant, with the annual capacity of 400,000 cubic metres. TH has also invested $32 million in the production of organic vegetables.

In addition to TH, Minh Phu Seafood, which is Vietnam’s largest shrimp exporter, has reported its plan to the Ministry of Agriculture and Rural Development (MARD) for a VND10 trillion ($467.3 million) project to raise shrimp and African carp nationwide. This project will be deployed in an integrated production chain, which involves the participation of millions of farmers. The project plans to produce 140,000 tonnes of shrimp and 50,000 tonnes of African carp by 2020, when the total revenue is projected to hit $2.5 billion, and 200,000 tonnes of shrimp and 100,000 tonnes of African carp by 2025, when the total revenue is expected to reach $3.5 billion. The project will include the construction of sub-projects, including a research institute, a shrimp breeding centre, animal feed and medicine factories, aquatic product processing factories, a logistics and distribution company, and the expansion of more export markets.

Nafoods Group, which is the world’s biggest exporter of baby jackfruit and passion fruit products, has also asked the MARD to support its VND2.05 trillion ($96.24 million) project to build more factories and rent more land. The group currently has a 5ha factory on 900ha of land in Nghe An.

“We want to expand the area to 5,000ha in Vietnam’s northern region,” said the group’s chairman and general director Nguyen Manh Hung. “Some VND1.35 trillion ($63.38 million) will be for constructing infrastructure and the remaining VND700 billion ($32.86 million) will be for cultivation.”

Nguyen The Ha, investment consultant from Bui Van Ngo Co. Ltd, said his company would invest VND1 trillion ($46.72 million) in expanding its existing VND1 trillion ($46.72 million) factory to make agricultural machines, starting in 2015. The company would also need more land.

Additionally, this company would implement a $1 billion project to process high-quality rice in the southern province of Long An. The project would include four clusters of factories able to dry 4,000 tonnes of rice per day and husk 800,000 tonnes of rice per year.